Tuesday, September 29, 2015

I'm proud to have submitted this commentary on a new tool from The Foundation Center - a map of democracy funding. The following post was written for PhilanTopic and originally appeared on PhilanTopic here. They're running a series of posts on democracy as we head into Election Day in November.

The U.S.
presidential election is thirteen months away. At this point, more thanfiftycandidatesare vying for nomination by the two major
parties. The field includes the lone member of the United States Senate
to stand as a Socialist and a New York City businessman who has four corporate
bankruptcy filings to his name. Members of the voting public may be said to
fall into two camps at this point — political junkies who simply cannot ever get enough of campaign politics and
the majority of Americans who plan to tune in about a year from now. The former
group is hell-bent on getting enough attention from the latter to raise the
country’s dismal
voting percentage to its presidential-election average, which hovers around
60 percent (ten points lower than the average for OECD countries).

Voter turnout is a big deal. Not just to political junkies
and clipboard-wielding party volunteers but also to American foundations.
According to Foundation Center’s newest mapping tool, Foundation Funding for U.S. Democracy, 180
foundations have spent more
than $150 million on voter education, registration, and turnout since 2011,
a period that includes one presidential and one midterm election.

Seems like a lot of money to get Americans to do what people
in many other countries die for. But we’re good at spending a lot of money on
our democracy. Even this early in the campaign, big donors are talking big
numbers, promising (threatening?) to spend $100 million or more each on their favorite
candidates or issues. And political junkies are predicting
that more than $4.4 billion will be spent on TV ads alone — while election spending
in total could run as high as $10
billion. Suddenly, nearly $150 million of foundation funding over four
years doesn’t look so big in comparison to $10 billion for a single election
cycle.

The huge sums of money have become as much a part of the
quadrennial American narrative as the quirky unknown candidates, their
inevitable stumbles and blunders, and the occasional important policy
discussion. Part of the interest lies in the sheer magnitude of the sums involved.
Imagine what we might accomplish in social services, education, or health care
if we spent an additional $10 billion.

But some of the interest also is driven by persistent efforts
to make campaign spending more transparent. Because presidential elections only
happen every four years, there’s a better-than-average chance that each one
will be “the most expensive ever.” Telling that story, tracking the numbers,
and highlighting the huge sums provided by a (tiny) subset of political donors has
become part of our republic’s ritual.

Organizations such as the Sunlight Foundation, MapLight, and the National Institute on Money in State
Politics find, clean, and load (in useful formats) the fundraising and
spending reports that candidates, campaigns, and various aligned political
organizations are required to file. The costs of doing this are more than you
might at first imagine, as we tend to think that simply posting data sets is
all that’s necessary to make that data useful. As proponents of transparency
and those trying to obfuscate know, raw data by itself as a first step is not
sufficient for sensemaking. Open and accessible is a requisite first step, but
cleaning, verifying, analyzing, and using it are still very much required. Even
so, various political
agendas have stymied efforts to require e-filing of these
reports as a first step, a regulatory change that would go a long
way to lowering the cost of making sense of political fundraising.

In the looking-glass world in which we find ourselves, the
more raw data on political fundraising and spending that becomes available, the
more we need nonprofit intermediaries, including investigative reporting
organizations, to help make sense of the data. For all its potential to make
information available at ever-lower cost, opening up data requires complementary
investments in mechanisms to make the data useful and help us make sense of it.

If the issues swirling around campaign finance reform sound
familiar to those of you who work in nonprofits, they should. The same set of
questions about e-filing and data disclosure also applies to nonprofit tax
filings. Earlier this year, the IRS lost a
legal challenge aimed at accelerating its heretofore-glacial efforts to put
nonprofit tax data online. Any year now we should see mandatory nonprofit
e-filing and the release of tax data in a machine-readable format.

If the nonprofit space follows in the footsteps of our
political system, the end result of a law to require nonprofits to e-file won’t
be a straight line to cheaper and more convenient access to that information. We’ll
also need more investments in the intermediaries and infrastructure that can help
us make sense of the increasing quantities of data we generate.

We’re reaching the stage where ready access to data on
spending in politics, on politics, and from foundations and nonprofits can be
assumed. This bodes well as a catalyst for greater understanding, more
insights, and, potentially, more participation. Not because the data will make
the responsibility of being an active citizen in a democracy any easier, but
because it will gives us more tools with which to work. Democracies depend on
participation and accountability, and broadly accessible useful information is
a precursor to both.

Tuesday, September 15, 2015

American foundations sometimes fund advocacy or policy analysis or community organizing as part of their strategies for particular types of social change.

But who advocates on behalf of foundations about philanthropic policy? And what are the policy domains that matter to foundations as enterprises? In 2013 my Stanford colleague Rob Reich and I published a policy forecast on the issues that pertain to American foundations and nonprofits. The usual suspects - tax code, payout rate - those are in there. You can read that document here.

But it's high time to recognize that the tax code is no longer the fundamental policy frame shaping philanthropy and nonprofits. In a time when social businesses, impact investing, campaign contributions, and crowdfunding are all growing, it should be obvious that tax privilege is only one factor that Americans consider when thinking about using their private resources for public benefit.

And in the digital age, the infrastructural issues that matter to civil society are going to be about data privacy, ownership, infrastructure access, security, and consent.

The tax code was the 20th century policy infrastructure for philanthropy.
Digital regulations will provide the scaffolding and shape for 21st century associations and expression - aka, civil society.
The laws on digital data and infrastructure will define how civil society functions in a digital age.

With this in mind, back in April I wrote a provocations piece on the policy infrastructure for philanthropy. I'm pleased to now make this document public. Here are the key points:

Focuslessexclusivelyontaxpolicy.Thefoundationinfrastructureandpolicygroupsneedtobuild working relationships and expertiseoncorporatecode,digitalpolicy,andinvestmentregulations(at least)

We also spend a lot on consumer goods that make us feel good - buying things because we think the product manufacturers give back. Call it cause marketing or embedded giving - it's a significant practice. This is the least well-measured of all of the above practices.

And, now there's also crowdfunding - some percentage of which is people putting their money behind projects with a social or public purpose. This space is still emerging, as are those who want to measure it (and make sure the data are made publicly available)

For every dollar an individual chooses to donate to a social or public purpose, she has to make one of these choices: donate, invest, political support, shop, crowdfund. This the universe of choices we face for all the private resources we want to put to public benefit.

There's a lot of information about this behavior that would be helpful. What type of dollar allocation "works" best for what kind of change/outcome? Are these choices complementary or exclusionary? Are people shifting from one choice to another?

We can't get to any of those questions until we first recognize that this is the world we live in, and start counting the dollars in each of these buckets. This we can do. We have data - not great, but something to start with - in each bucket. We should come together and create a unified index that brings the different strands together. Mark the baseline now.

Then we can have a meaningful discussion for the 21st century over how people use their private money for public benefit.

Donors will be to see their choices better and make better decisions. Philanthropy advisers, like Jamie Forbes of Opus Advisors with whom I was discussing this idea, can better help the hundreds of thousands of families whose money makes up all this revenue make more meaningful choices.

The social economy that relies on this funding will be seen as the sum of its parts, not just the components. It, too, is not monolithic - it includes charitable nonprofits, social businesses, co-ops, networks, online alliances, and new enterprises that are just coming into being. It looks like this:

This framework of the social economy has been the basis of the Blueprint series for the last six years. Most people I talk to now see this world, all around them. It's time we came together and measured and reported on what's really happening. We need this new index. The data are out there - let's make it happen.

(Cup of coffee on me to whoever comes up with catchiest name for it....)

Friday, September 04, 2015

There’s a new research journal — RIO- that is an experiment in opening up science. As the description says

"All outputs of the research cycle, including: project proposals, data, methods, workflows, software, project reports and research articles together on a single collaborative platform. Watch a short video explaining RIO Journal."

This isn’t a gimmick. It’s an adaptation of existing scientific publishing to the reality and potential of digital data and the practices they enable.

The same opportunity exists for philanthropy and civil society. Imagine if the whole process of foundation funding — from problem scoping through outputs was designed so that the participants, the beneficiaries, the grant receiving group and the funder shared what they were doing, why, how it was going, iterations and changes, and accomplishments, successes, and failures. Others could learn from what was happening. Problem statements could be shared, iterated, diversified and rejected, instead of endlessly recreated in vacuums. Same for the rest of the process.

Designing for open first requires getting ongoing human centered consent and using minimum viable data practices (at least). Working this way aligns with the possibilities of using our private digital resources for public benefit — the working definition of digital civil society.

About me

Why is this blog called Philanthropy 2173?

This is a blog about the future. The year 2173 seems sufficiently far enough in the future to give us some perspective. As sure as we are of ourselves now, talking about the future - and making philanthropic investments - requires that we keep a sense of modesty and humor about what we are doing. Philanthropy is for the long-term - for the year 2173.